[Congressional Record Volume 170, Number 4 (Tuesday, January 9, 2024)]
[House]
[Pages H8-H11]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             MATH-FREE ZONE

  The SPEAKER pro tempore (Mr. LoLota). Under the Speaker's announced 
policy of January 9, 2023, the gentleman from Arizona (Mr. Schweikert) 
is recognized for 60 minutes as the designee of the majority leader.
  Mr. SCHWEIKERT. Mr. Speaker, I wanted to do a little bit of an 
update, and I apologize for the three or four people who actually pay 
attention to the math. They will have seen some of this. Nevertheless, 
I have a point I want to try to make tonight. I am going to work on 
this over the next couple of weeks because I have to find a way to do 
this better because, apparently, I am not breaking through.
  I tease a lot that this is a math-free zone, but I brought the boards 
to walk through the economic studies that basically show you can tax 
the rich and get about 1\1/2\ percent of GDP if you tax everything. 
Over here, when we are talking about doing cuts, we could probably get 
a point of GDP when you consider that, Mr. Speaker, all 
nondiscretionary might be 2\1/2\ to 3 percent of GDP.
  So the understanding thing is to say: What we are talking about is 
cutting on our side; they are taxing on that side. You might get 3 
percent of the economy.
  Since this fiscal year, so we are a little over one quarter in this 
fiscal year, I think if you add up everything, Mr. Speaker, we are 
borrowing about 9.6 percent of the economy. In the last 365 days, we 
borrowed 8.4 percent of the entire GDP.
  Does anyone see a math problem?
  This is my frustration. The border is incredibly important, and 
getting these budget bills done is incredibly important, but the house 
is burning down around us.
  One of the things we started about 6 weeks ago--and it has taken 
off--is to sign up on our website, and every single day I am going to 
send you the daily debt text. Yes, Mr. Speaker, you are out of your 
mind if you care enough about the math to want to get it. It tells a 
very powerful story.
  Mr. Speaker, this is what you are going to get every day: a text from 
me. We have built a system of grabbing off the Department of the 
Treasury's website and saying: Hey, this is what we borrowed this 
fiscal year, here is what we borrowed in the last 365 days, and here is 
what we are borrowing per second.
  Mr. Speaker, this is from, I think, yesterday. Yesterday, over the 
last 365 days, we are borrowing $83,377 every second. We borrow over 
$83,000 a second. If you do just this fiscal year, Mr. Speaker--and 
there are some timing effects. Remember, we take in some tax receipts 
in April, we pay Social Security interest twice a year, and that can be 
$25, $30 billion in interest. Nevertheless, Mr. Speaker, if you do just 
this fiscal year, $99,480 per second is our borrowing. It is not 
spending, it is borrowing. Mr. Speaker, if you are interested in this, 
sign up.

  I have been trying to make the point that the world changed when 
interest rates started to go up. The world changed over the last couple 
of years when healthcare costs went up fairly dramatically. They 
continue to, and most of that is demographics. We like to pretend, oh, 
it is things we can control. Unless we have a magic way for baby 
boomers not to get older, then we need to deal with the reality of our 
demographics.
  Mr. Speaker, Social Security is our number one spend at $1.450 
trillion. Interest, gross interest, total interest this fiscal year is 
projected to be over $1 trillion making it the number two spend in our 
government. Interest.
  Number three is Medicare, and number four is defense. A couple of 
these numbers may actually even go down a bit on things like defense, 
not Medicare, with some of the budget negotiations that are being 
finished up right now.
  When is the last time you actually had anyone say, hey, did you know 
that defense is actually number four, not number two, not number one? 
It is number four in our spend? Interest is number two.
  If I had said that a couple of years ago, Mr. Speaker, you would have 
thought I was out of my mind.
  How do I get my brothers and sisters here to pay any attention that 
we are knifing each other?
  Mr. Speaker, I just showed you a chart that shows over the last 365 
days we are borrowing I think $7.2 billion a day--a day--and we are 
having fights for months now on things that are $6 billion. It is a lot 
of money. It is a tremendous amount of money, but understand we are 
borrowing over $7 billion a day.
  Just for those who don't like math or charts, we have produced a 
pretty chart where you can see little bars that are basically saying: 
Here is Social Security.
  The reason I made this chart is because you will often hear from 
those who are trying to spin you on these numbers: Well, we only spent 
this in interest, and the other interest we paid to ourselves.
  That is because we borrowed the money. When we reach into the Social 
Security trust fund, when we reach into the transportation trust fund, 
and when we reach into the Medicare trust fund, we grab the cash, we 
spend it, and now we have to pay back that principal and pay interest 
on it. That is why you see the difference, Mr. Speaker. Even then, even 
the net interest, looks like it is going to be the second biggest 
expense in the U.S. Government this year. That is a stunning number.
  This one is a little hard to read, and I have several charts here 
that we may

[[Page H9]]

go through very quickly because they are awfully technical, but we are 
just trying to make the point, Mr. Speaker, that if you look at this 
line here, I am trying to make a point that we benefited and we lived 
in a fantasy land for a decade with artificially low interest rates.
  Reality has come home, and we are not intellectually prepared to deal 
with reality. That is what this chart is telling you, Mr. Speaker. As 
you start to look at this, that is how we are about to have a $1 
trillion interest coverage cost this year.
  Let's actually have a little bit of fun here in a sort of sadistic 
way. We had $34 trillion last week, and a number of Members here did 
their little social media: It is horrible, it is this, and it is that.
  Mr. Speaker, if I were to ask our brothers and sisters: How many days 
before we go from $34 trillion to $35 trillion?
  It is simple math. If you are borrowing about 7.3 or $7.4 billion a 
day, then it is about 140 days. In 140 days they get to rewrite that 
same social media post by just removing the 34 and making it 35. Then 
140 days after that do it again because it will be another trillion 
dollars.
  We are burning down, and it is not what we often debate behind these 
microphones.
  We debate waste and fraud. Yes, it is a huge deal, and we have to go 
after it. We debate foreign aid. If we get rid of every dime of foreign 
aid, it is about eight days of borrowing. Tax the rich--great. I am 
going to show you that you can get about one point and a half of GDP. 
Last year we borrowed 8.4 percent of the entire economy.
  We need to grow up here and start to understand policy. I have done 
presentation after presentation here showing that the biggest thing we 
can do for America on debt and deficits and the morality--and I get the 
crap kicked out of me for telling the truth--is take on obesity, take 
on diabetes, change the cost of healthcare, and adopt technology to 
change the cost of government. We need to be willing to disrupt the 
business models, the bureaucracy models, the calcification 
intellectually around here and say that we need to go as fast as we can 
to adopt things that make us healthier, faster, better, and more 
prosperous, and get growth going. Instead, the hallways here in 
Congress are full of people who basically come in, whine at us, and 
say, I need more money; or, don't you dare change things, I don't want 
to have to compete against that new technology.

  Between April 20 and May 20 is my best math. We are going to cross 
that $35 trillion debt threshold. This fiscal year, at the end of 
September, we could be as high as over $36.2 trillion in borrowing.
  For all of those who gnash their teeth and whine and say, oh, 34. 
Before the fiscal year is over, you are up another $2 trillion.
  The speed of this--I am being a little bit of a jerk on--but I think 
it is deserving. We burnt this place down last June. A little after 
that, we did the debt ceiling agreement. We actually got some spending 
cuts, about $100 billion, and then there are some games in it for 
raising the borrowing, and a little while after that we removed our 
Speaker, and we basically weren't able to do anything for months.

                              {time}  1930

  What was the debt of the United States when we did that debt ceiling 
deal? It was $31.8 trillion. We made a big deal. We got rid of a 
Speaker. We did all these other things. How much progress did we make 
since then? A lot of people got television time screaming about this.
  Well, let's see. We hit 34 last week, and into this April, we will 
hit $35 trillion. That is a great job.
  We don't seem to understand that 100 percent of the debt that is 
growing from today through the next 30 years--and this really makes 
people uncomfortable--is demographics. It is the interest. It is 
healthcare costs. In about 8, 9 years, in 2033, the Social Security 
trust fund is empty. Our best math is that first year, the shortfall is 
$616 billion. That is just the shortfall. That is a 25 percent cut for 
seniors in 8, 9 years.
  We will double senior poverty. How many people here do you see coming 
up and saying, ``We are going to fix it,'' but many of the solutions 
are to just raise the cap? We are going back and triple vetting our 
numbers, but some of the numbers look like if you just raise the cap 
and have everyone pay their 12.4 percent all the way up no matter what 
the income is, it may only cover 20, 30 percent of the shortfall.
  You have to do all sorts of other taxes. When you do that, you have 
taken away your ability to have any optionality for everything else.
  Once again, we work in a math-free zone. This chart is the single 
chart I get the most complaints about, so it must be hitting home. This 
chart is now 2 years old. We just haven't had time to do the update on 
it. It is only worse today. It was basically saying, in 30 years, you 
had $116 trillion of debt. Our new math is closer to $130 trillion if 
interest rates continue to stay well over 4 percent.
  It is basically saying $77 trillion over that 30 years--Medicare. The 
shortfall is healthcare costs and the financing of it. Then over here, 
$38 trillion is if we backfill Social Security.
  How much real work are we doing here? How often do we go home and 
tell the truth to our constituents? Unless we actually start to act 
like fiscal adults and take on policy, major changes in policy, 
particularly on healthcare, to change the cost of healthcare--it is not 
financing. There is the intellectual vacuousness around here.
  ObamaCare was a financing bill. The ACA is a financing bill, who got 
subsidized and who had to pay.
  Over here, we had our Republican alternative. It was better. It fixed 
a bunch of the actuarial curve, so hopefully younger people would be 
willing to participate, but it was a financing bill.
  Medicare for All is a financing bill. It is not changing what we pay; 
it was just changing how we pay it.
  You need the adoption of technology, whether it is something you can 
blow into and it prescribes--and that technology exists, except it is 
illegal. It is down to actually having the brutal discussion of why we 
are so sick as a country.
  Seriously, particularly for working-age, prime-age males, life 
expectancy may be going down again for another year. We are dying. In 
18 years, this country has more deaths than births. Remember, our 
fertility rates last year fell to 1.64, 1.65. It is math, but there are 
things we can do. There are ways to make this work, but in dealing with 
the conversations about raising taxes on rich people--and you show the 
charts from their own studies and they just stare at you, saying: Well, 
I can't actually say that because that is not what I have been telling 
my voters.
  I have offered amendments here this fiscal year to remove every dime 
we send to entities that have their own taxing authority. Those are 
brutal amendments, but about 30 to 40 percent of all nondefense 
discretionary is money that we borrow and send to cities, States, 
counties that have their own taxing authority. They will scream if that 
passes, but it is intellectually honest. Should we borrow money to send 
it to entities that have their own taxing authority?
  Please understand that every dime of defense, every dime of what you 
think of as government--the FBI, the Supreme Court, my salaries, 
everything else--is all borrowed. It looks like where we are heading 
right now, which is part of the punch line of tonight's presentation, 
every dime of defense, every dime of nondefense discretionary, and 
maybe $500 billion of Medicare will be borrowed this year.
  Doesn't that send shivers? Am I the only idiot here who actually 
reads these numbers and then reads them over again, then goes back and 
has another cup of coffee and reads them again? Yet, when you talk to 
the television producers, they say that is not interesting. The public 
doesn't really care about math.
  Well, they will when their pensions collapse. This is no longer about 
your grandkids, your kids. This is about your retirement being screwed 
over.
  Just for the intellectual opportunity here, we produced this slide. 
The United States right now is hitting about 4 percent in our 10 year. 
What is going on in the world when Greece has a lower interest rate on 
their 10-year sovereign debt than we do? Italy is lower than the United 
States. Portugal is lower. Spain is lower. The entire Southern Europe 
average is 3.31. We did

[[Page H10]]

this math as of yesterday, and the United States is around 4.
  I grew up in a household where my father was wonderful in teaching me 
about stock markets and bond markets and those sorts of things. Some 
kids on Saturdays went to the ballfield; I went to the stock exchange 
with my father. It is just what we did.
  Bond traders and the data they work with are some of the smartest 
people you can possibly imagine. What is the bond market telling us 
when the U.S. interest rates on a 10-year bond are higher than even 
Southern Europe? Greece has a better interest rate than we do. What do 
they know that we don't? I have a different way to phrase it. We know 
it, but we are just not willing to digest it because it is 
uncomfortable because it would force us actually to do really hard, 
difficult stuff, and this place is barely capable of doing our basic 
job. Then, we run like crazy.

  I have used this chart before. I need it to be steeper, but you have 
to understand that if we continue to stay well over 4 percent, we 
actually have some models here that say: Guess what? We are heading to 
300 percent of GDP in debt.
  I am going to show some slides from the OEC. If they add up all of 
our debt, not unfunded liability or current borrow, they already have 
us at 144 percent.
  Now, I think we may hit it in the next few weeks, but we will be at 
100 percent as the Treasury scores it, 100 percent of debt-to-GDP of 
publicly held debt in the next few weeks. We finally did it. We did it.
  I am going to go through some of these slides brutally fast. I am so 
sorry for those trying to keep their fingers going to take this Record. 
Wave at me if I am speaking too fast. I have had a lot of coffee.
  For my brothers and sisters on the left, I am going to do two or 
three slides to point out something. Did you know that when we did tax 
reform at the very end of 2017, we actually made the income tax system 
in the United States more progressive? Wealthy, high-income earners are 
actually paying a higher percentage of Federal income tax today than 
they did before we did tax reform. How often do you ever hear them come 
behind the microphone and say: We give away to the rich this and that.
  Oh, come on, clown show. You can read the CBO charts and the Joint 
Committee on Taxation charts as well as I can. I think you can. Read 
them. The fact of the matter is the top 1 percent of income earners pay 
23.3 percent of all Federal income tax, and that is actually higher 
than it was before tax reform.
  Let's see if this is an easier way to digest it. The upper-end income 
taxpayers finance nearly the entire Federal income tax. If you take a 
look at the top 20 percent of income earners and then go to the second, 
they only pay 5 percent. There is 15 percent, 5.7, then 2. When you get 
down to the bottom 40 percent of quartiles, they actually have a 
negative income tax. We give them money back, the earned income tax 
credit. Then you start to look at when Bernie Sanders and Elizabeth 
Warren--or even their oligarch tax. They hold these press conferences 
like we are going to tax rich people and solve the problem.
  Please understand, I am not defending rich people; I am defending 
math. Then you start to see it and you say the Sanders plan gets us 
$440 billion. Except when we actually did this chart, we expected the 
debt to only be $1.8 trillion. It may be $2.8 trillion at the rate we 
are going right now. The point here is the theatrics you keep getting 
of the tax policy don't get you there.
  The dirty little secret is what happens a few years from now when the 
Medicare trust fund is gone, the transportation trust fund is gone, and 
the Social Security trust fund is about to go. What are we going to do 
policywise? Raise taxes on everyone over $400,000. You covered a 
fraction of your problem. We are going to go to a VAT tax.
  The problem is a VAT tax is crushing to the poor. It is crushing to 
the working middle class. It is not progressive. It is really efficient 
in taking money out of people's pockets.
  You can do that or do what we have done the last 40 months, which is 
let inflation go. In the last 40 months or so, we have actually had 
probably the biggest tax hike in modern history, and no one knew they 
got it. When inflation goes up, your savings goes down in its 
purchasing value, but the U.S. sovereign debt actually is able to be 
paid back with inflated dollars.
  Why do you think so many governments, when they get themselves upside 
down in debt, set off inflation? It is a way to tax you and not even 
tell you we were doing it.
  I don't think anyone wants more. I have done this before, and I 
realize it is like talking to a wall. Income tax revenues have remained 
relatively constant regardless of the top tax rate. The basic point of 
this is, what do you get as a percentage of the economy?
  Let's actually walk through it. In the 1950s, every once in a while 
you will hear leftists talk about you had a 90\1/2\ percent tax rate. 
Yes, and income taxes produced 7.2 percent of the economy. Let's do the 
Clinton years. You got down to 36.7 percent top marginal tax rate. You 
got 8.1 percent. Today, we are at 37 percent. We get 9.2.
  Anyone see the punch line? Sometimes when you had these incredibly 
high marginal tax rates, you get this much of the economy. Low marginal 
tax rate, you get the same amount of the economy.

                              {time}  1945

  The secret is a dramatically larger economy. You want tax receipts, 
tax revenues. You have got 100 years of data out there showing when we 
have had very high marginal tax rates, we got the mean. When we got 
very low, we got the mean. However, when we got very low, the pie was 
getting bigger. When you had very high, the pie was actually getting 
smaller.
  This is just a chart basically saying the same thing I just walked 
you through.
  All right. Let's actually go on to something I find fascinating. I 
have done this a couple times, but it does not seem to sink in. Anyone 
out there who is--what do you call that? Oh, yeah--literate and would 
actually have an interest in reading something that is very well 
written, but it is simple, go to Manhattan Institute, Brian Riedl.
  He has an article from about 5, 6 months ago where he put together 
all these academic articles and also our joint tax stuff from CBO, from 
the administration, and put it together and basically said, what would 
happen if you actually did the Democrats' plan?
  Great. Take people over $400,000--and remember, the purchasing power 
of $400,000 has dramatically changed over the last 40 months because of 
inflation. Take everyone that is over $400,000 and maximize their 
income tax, maximize their capital gains tax, maximize their estate 
tax, just maximize everything, what could you get?
  I have a series of boards here from the article that basically say, 
okay, if you maximized the estate tax, just maximized it before it 
changed behavior--or, in this case, on estate tax it doesn't change 
behavior much, but you get 0.1 percent, so max rate on estate tax, 0.1 
percent of GDP. Great, that got a lot done.
  Now, if you come over here and do some of the others, you also do the 
corporate tax, you add up, do an increase on the international, do all 
the Biden corporate tax hikes, do some of the additional garnishment in 
many ways of the corporate savings, actually at the end you get another 
point and a half of the economy in taxes.
  This will make sense in a moment. Then you go on to this. It is 
referred to as the maximum sustainable revenue from taxing the rich. 
Now you sort of walk through everything, and then add them all up. What 
is the punch line? Well, the punch line comes down to--I need to get my 
boards straight--total amount, raw number, you get about 2.1 percent of 
the economy in new taxes.
  You have got to now adjust for the economic effects because you just 
slowed the economy down. Something we don't tell the truth enough about 
is when we do certain cuts, when we do certain taxes, we do change the 
size of the economy. The best math out there is you get about 1.1 to 2 
percent of the economy. That is it. That is the tax-the-rich plan. You 
get 1.1 to 2 percent of the economy.
  We borrowed 8.4 percent of the economy last year, and my math right 
now looks like in this first quarter of this year, we borrowed 9.6 
percent.

[[Page H11]]

  Look, I get screamed at by staff saying, no one knows what GDP and 
percentage of GDP is. I am trying to talk to people like they are 
adults. The tax side doesn't work. Should we change parts of the tax 
code? Okay, I am fine with that, but don't think it is the solution.
  For my brothers and sisters on my side, I need to put them together. 
It is a little harder, showing all the discussions of what we think we 
can cut. I come up with like a point, maybe a point and a quarter of 
GDP.
  Now, you have got to understand. I will do a reference, so this makes 
sense. Back, last June, when we did the debt ceiling deal, there was 
$100 billion that was going to be removed from nondefense 
discretionary, so you are functionally going from $700 billion to $600 
billion something.
  Bloomberg Analytics--which has really good economists and really good 
data systems, they have spent a fortune building this model--came back 
and said, yeah, actually in 2024, if you execute that, yeah, you are 
going to save $100 billion, but you will also slow down the economy by, 
like, a half a percent.
  Something we actually don't talk about is big-boy economics. When 
they want to raise taxes, and even when we want to cut spending, it 
does have economic effects. We need to calculate those things in, so we 
are being honest about the math.
  One last board, Mr. Speaker. I am not going to make you all suffer 
through this. I guess I am trying to make a point. There is hope. There 
is a way I can make this work, but we have got to do it all together. I 
mean, we couldn't even organize lunch if we wanted to. There is a way 
to stabilize the debt to GDP, but it has to be done through policy.
  Those who look you in the eyes and say, I can cut it and get there, I 
can tax and get there, they need to own a calculator, and I can give 
them some great literature to read.

  However, there is policy out there, and policy is hard because you 
have got to be willing to look a number of the army of lobbyists, many 
of our constituents, many of the people here and say, there is a reason 
you didn't go to Blockbuster Video last weekend. Technology creates 
revolutions. Instead, now you hit a button at home and you stream.
  Those changes are already here that could dramatically change the 
cost of healthcare, dramatically change the cost of what it is to 
protect the environment, dramatically change the cost of building 
transportation. The technology, the engineering is here, but the laws 
we have passed, the way we reimburse things, we are still defending the 
old model.
  If we want to save the country, we have dozens of things that are 
incredibly important, but I will argue, we cannot survive a few more 
years of every 140 days borrowing another trillion dollars. If you want 
to understand what takes republics down, it is ultimately when they 
have to inflate their currency, when they have to crush anyone with 
savings, destroy your kids' future, your retirement, and that is what 
we are heading to.
  There is hope, but every day we sit on our hands here, that hope gets 
a bit dimmer.
  Mr. Speaker, with that bit of joy, I yield back the balance of my 
time.

                          ____________________